Post Cyprus Russia Bars Overseas Accounts for Officials

A law just passed in Russia will prevent any government official from keeping cash in overseas bank accounts or owning “stocks, bonds or foreign issuers’ shares outside Russia.” Any breach of this law will end in the politician being “sacked or forced to resign.” There is a fear in the homeland that investors keeping funds abroad are a threat to the well-being of the Russian government.

Chairman of National Anti-corruption Committee of Russia, Kirill Kabanov stated: “Russians who are focused on their well-being in the West are a threat to the state, and most of all they are a threat to the power of the president”.

In light of recent economic woes in Russia and trouble faced by Russian investors in Cyprus, the government has encouraged individuals to repatriate capital they may have been keeping overseas. The suggested action hasn’t been taken seriously as Russian money has poured into the British Virgin Islands and other foreign havens like Luxembourg. Now that such action is illegal, at least among politicians and officials, it will be interesting to see how the scenario plays out. So far it seems some have already devised ways around the law.

However, it is significant that a higher rate of divorces by officials has been observed lately. This has led many to believe that divorces are an attempt to keep foreign assets and hold public office positions at the same time, since the accounts can remain with the divorced spouse.